Well, that didn’t take long.
Only one month after the Inland Empire’s purchasing managers index fell below 50 for the first time in more than two years, the much-watched statistic came roaring back, according a report released Thursday.
July’s index was 55, comfortably above the 50 benchmark that determines if the region’s manufacturing sector is expanding or contracting, according to the Institute of Applied Research and Policy Analysis at Cal State San Bernardino.
More importantly, it was well above the 46.3 index recorded in June, which marked the first sub-50 score since December 2016, ending 29 straight months of expansion.
Because three consecutive months in either direction are needed to establish a trend, last month’s report wasn’t reason to panic, said Barbara Sirotnik, institute director and co-author of the monthly study.
“It was probably an aberration, but we don’t know for sure,” Sirotnik said. “I can tell you there’s a lot of uncertainty about what’s happening in the manufacturing market. There are people who are optimistic, but there are some who are pessimistic.”
Four of the five categories that make up the index – new orders, production, commodity prices, employment -were up in July compared with June.
Only supplier deliveries fell, from 58.3 to 48.3, but that indicates the speed of deliveries is increasing.
Fourteen percent of the purchasing managers surveyed said they expect the local economy to improve during the next three months, while 64 percent said they expect it to stay the same and 22 percent said they expect it to get weaker, the report stated.